Fully Paid Securities Lending (FPSL) can be a way to earn extra income from stocks you already own, but it also carries risks you should understand before enrolling.

What are the risks?

• No guarantee of lending: there's no assurance your securities will be lent or that a market for them exists.
• Market price risk: when securities are lent for short selling, there's a possibility their price may decline.
• Loss of voting rights: temporarily transferred to the borrower while shares are on loan. Unenroll at any time to restore them.
• Tax implications: income from lending may have tax consequences.
• Not covered by SIPC: loaned shares aren't SIPC-protected.

What happens to my SIPC coverage?

Loaned shares aren't covered by SIPC. Instead, Alpaca holds cash collateral equal to at least 100% of your loaned shares' value at a third-party bank. If Alpaca couldn't return your shares, that bank would compensate you in cash, also FDIC-insured up to 250,000 USD.

Can I sell a stock while it's on loan?

Yes, at any time. Once the loan closes, which may happen at the same time as the sale, loan interest stops for that position.

Is Pattern Day Trading (PDT) still available?

Yes, Pattern Day Trading is supported while you're enrolled in FPSL.